This paper presents a conceptual framework for analyzing the impact of funding cutbacks on human services organizations (HSOs). HSOs include publicly-funded educational, health, welfare, and cultural organizations. The framework identifies five categories of variables which influence an organization's reaction to cutbacks. Category one, "objective characteristics" of cutbacks, includes the severity of the cut in terms of money and time schedule, the funding organization's reasons for the decision, and the degree of power the funding source has to dictate the specific nature of cuts. Category two, "contextual conditions" of cutbacks, includes the level of awareness and interaction of the HSO with other groups in its field, experience and personality of the HSO's administrators, and the organizational structure and management of the HSO. Category three includes the way the cuts are perceived by the HSO's key decision makers. Their perception of the cuts' severity and causes, and the power of funding the agency directly affect the action they take in response to the cuts. These responses constitute category four: reduction of organizational activities, efforts to replace lost funding, and changes in internal operations. The last category, which is affected by the HSO's responses, includes changes in organizational effectiveness and in the quality of the working life of its staff. (AV)